“You have to act with overwhelming force.” Well, Then Do It.

by CC September 24, 2011 6:08 pm • Commentary

From Reuters here are some quotes from Finance Ministers, IMF officials and such at the G20 meetings stating that what needs to be done is big bold action. (bold emphasis mine)

ALEXANDRE TOMBINI, PRESIDENT OF BRAZIL’S CENTRAL BANK: “We are at a very critical juncture now combining sovereign risk and slow growth. So this is a combination that might stay with us for a while and it certainly anticipates a very difficult period. Brazil’s experience with past crises suggests you have to confront the problems in a fast, consistent manner. The longer it takes, the higher the cost, the more contagion spreads. You have to act with overwhelming force.

JAPANESE FINANCE MINISTER JUN AZUMI, IN STATEMENT AT IMFC: “Concerns about growing sovereign debt problems in Europe and the resulting financial system vulnerability are the biggest sources of the current global financial instability. European countries should come together and take action responsibly.

IMF MANAGING DIRECTOR CHRISTINE LAGARDE: “There was a common recognition, a common diagnosis of what is happening at the moment and of shared sense of common purpose. As far as the IMF is concerned, it is ready and it will deliver on any type of resources necessary and available to all its members.”


“The global economy has entered a dangerous phase, calling for exceptional vigilance, coordination and readiness to take bold action from members and the IMF alike. We are encouraged by the determination of our euro-area colleagues to do what is needed to resolve the euro-area crisis.”


“Euro-area countries will do whatever is necessary to resolve the euro area sovereign debt crisis and ensure the financial stability of the euro area as a whole and its member states.

“…Advanced economies will ensure that banks have strong capital positions and access to adequate funding; maintain accommodative monetary policies as long as this is consistent with price stability, bearing in mind international spillovers; revive weak housing markets and repair household balance sheets; and undertake structural reforms to boost jobs and the medium-term growth potential of their economies.”

And here are is a quote from Tim Geithner (Timmeh!) suggesting that maybe the critical players in Europe still don’t get it:

U.S. TREASURY SECRETARY TIMOTHY GEITHNER, ON BBC RADIO: “All of us who look at Europe going through this have to have admiration for what they are trying to do and recognize the difficulty of it but also help them understand that markets are moving much more quickly than they are moving, and these things have the classic dynamic that the longer you wait the harder it is to solve, the more expensive it is to solve, and there is a huge premium on early action.”